The Most Important Chart In Europe Is Getting Dramatically Better

Yields on Italian and Spanish bonds are dropping fast this
morning, after a bond auction in Spain saw decent demand from
investors.

Borrowing costs remained high at auction; for example, yields on
two-year notes rose from 2.069 percent last month to 4.706
percent. However, the fact that primary market borrowing costs
were below where yields in the secondary market--they started at
over 5 percent today--suggests that the bearish reaction to the
Spanish bank bailout deal might be overblown.